An Overview of QRMP Schema under GST

What is the QRMP Scheme?

QRMP, or Quarterly Returns with Monthly Payments Scheme, is a scheme introduced by the Indian government to make it easier for small taxpayers to maintain compliance by reducing the compliance burden on them. Under this scheme, small taxpayers are allowed to file GSTR-1 and GSTR-3B quarterly while making GST payments on a monthly basis, thus reducing their compliance requirements.

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Why is the QRMP Scheme Important?

QRMP scheme has various benefits for the taxpayers. Here are the major benefits of opting for the QRMP scheme -

• It reduces the taxpayer’s obligations regarding the filing of GST returns. After opting for this scheme, the taxpayers will have to file only 4 returns as against 12 GSTR-3B during the year.
• Taxpayers can opt in or opt out of the scheme at any time during the year without any restrictions.
• This scheme helps taxpayers conveniently pay monthly taxes using the self-assessment method and pre-filled challan in the first two months of every quarter.
• You can also get the benefit of a flexible invoicing facility, wherein you can furnish 4 GSTR-1 every year. You can upload your invoices during the first 2 months of the quarter and also claim input tax credits quickly.
• It also reduces your cost for the assessment of tax liability by reducing compliance requirements from a monthly to a quarterly basis.

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What are the Eligibility Requirements for QRMP?

The Quarterly Returns with Monthly Payment (QRMP) scheme aims to simplify the GST compliance process for small taxpayers. Given below are the eligibility criteria for opting QRMP scheme -

• The annual turnover of the taxpayer should not exceed Rs. 5 crores.
• The taxpayer must not fall into categories such as a non-resident taxable person, a casual taxable person, or an Input Service Distributor.
• The taxpayer should not be involved in supplying goods through an e-commerce operator obligated to collect tax at source under Section 52 of the CGST Act.
• The taxpayer should not have opted for the Composition Scheme under Section 10 of the CGST Act.
• There should be no pending GSTR-1 or GSTR-3B returns for any tax period before the QRMP scheme's implementation.

Upon meeting these criteria, a taxpayer can choose the QRMP scheme, allowing them to file GSTR-1 and GSTR-3B returns quarterly, accompanied by monthly payments toward their GST liability. The primary objective of the QRMP scheme is to ease the compliance burden on small taxpayers, granting them additional time to concentrate on their core business activities.

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How to Opt for the QRMP Scheme?

A registered individual intending to submit GSTR-3B on a quarterly basis must declare this preference on the GST portal, starting from the 1st of the second month of the preceding quarter until the last day of the first month of the relevant quarter.

For instance, if individual A wishes to file quarterly returns for the Apr-Jun 2024 quarter, they must have selected the quarterly filing option on the common GST portal between February 1, 2024, and April 30, 2024.

Once this choice is made, the registered person must consistently file returns every quarter for all subsequent tax periods unless certain conditions arise:

If the taxpayer becomes ineligible for quarterly filing (e.g., if the aggregate turnover surpasses Rs. 5 crores during a quarter), they will be required to file GSTR-3B on a monthly basis from the next quarter onwards.

A registered person cannot opt for quarterly returns if the last due return, as of the date of choosing this option, remains unfiled. For example, if someone opts for quarterly GSTR-3B filing on December 1, 2020, they must have submitted their GSTR-3B return for October 2020, which was the last return due at the time of opting for quarterly filing.

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When can one opt for the QRMP scheme and submit returns?

Taxpayers can either opt in or opt out of the scheme for the quarter between the first day of the preceding month of the quarter to the last day of the first month of the quarter. For example, if someone wants to opt into the scheme for the April-June quarter, you can do it between 1st Feb and 30th April.

GSTR-3B return should be submitted by the 22nd-24th of the next month. The last GSTR-3B should be filed before opting for the QRMP scheme. So, if you are planning to opt for the QRMP scheme, you must have filed GSTR-3B for March by April 22-24. Also, if you opt out of the QRMP scheme now, you will have to submit GSTR-1 and GSTR-3B monthly.

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What are the Payment Methods Under the QRMP Scheme?

There are two main modes of payment under the QRMP scheme that you can use.

• Fixed Sum Method: If you filed your last GSTR-3B quarterly, you could get a pre-filled challan for 35% of the tax amount in the previous quarter. However, if you are a new taxpayer or have recently opted out of the composition scheme, you cannot access the 35% challan amount.
  Similarly, if your last GSTR-3B was filed monthly, you can get a pre-filled challan for the full tax amount in the previous quarter’s last month.
• Self-Assessment Method: Under the self-assessment tax method, you can easily submit the actual tax amount that is due on the outward and inward supplies, along with the ITC available.
  You can use the tax amount submitted for the first 2 months to adjust any tax liability that you have in the quarter through GSTR-3B.

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Due Dates for Filing Quarterly GSTR-3B

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Input Tax Credit Claims Under QRMP

Registered taxpayers under the QRMP scheme follow the same process to claim Input Tax Credit (ITC) as other taxpayers. QRMP taxpayers using the self-assessment method for tax payments in the first two months of the quarter can rely on the ITC reflected in their monthly GSTR-2B and pay the remaining GST liability in cash.

The quarterly GSTR-2B is generated on the 14th of the month following the quarter after filing the GSTR-1 for the quarter. Therefore, buyers transacting with vendors under the QRMP scheme must refer to the quarterly GSTR-2B for their ITC claims.

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Late Fee Under QRMP Scheme

Understanding the QRMP scheme is pivotal for small businesses. In addition to reducing the frequency of filings, it offers financial flexibility and ease of operations.

Despite the different schemes like QRMP and composition schemes, GST can be complex and time-consuming, especially for small business owners. If you are among those struggling with taxes, get in touch with our experts, who can not only help you with GST return filing but also solve your tax-related queries. Book an online CA Now!

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